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Power Metal Resources PLC Quarterly Business Operational Update

01/10/2021 1:56pm

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TIDMPOW

RNS Number : 7804N

Power Metal Resources PLC

01 October 2021

1 October 2021

Power Metal Resources plc

("Power Metal" or the "Company")

Quarterly Business Operational Update

Power Metal Resources PLC (LON:POW) the London listed exploration company seeking large-scale metal discoveries across its global project portfolio announces the September quarterly business operational update for shareholders.

Paul Johnson, Chief Executive Officer of Power Metal Resources plc, commented:

"We consider Power Metal to be a global project with thirteen project packages across three continents and targeting nine precious, base and strategic metals.

At the heart of our business is resource prospect generation, targeting district scale resource opportunities for internal development or value crystallisation.

Look below and you will see the results of our work to date and the potential the Power Metal business offers.

As a longstanding private investor and public company director in the junior resource space I often encounter the frustrations and the jubilations offered by a cyclical market.

Our duty, notwithstanding market conditions, is to remain focused, to continue to build and, above all, to justify shareholders' trust in Power Metal through quantifiable delivery."

Note: in addition to the material presented below, investors are guided to the Power Metal corporate presentation which is available on the Company's website through the following link:

https://www.powermetalresources.com/presentation/

PROJECT OPERATIONS UPDATE

The tables below provide the latest status of each project within the Company's portfolio and include:

   -     Exploration project updates from African, North American and Australian interests; 

- Corporate development updates for project packages advancing towards spin-out into their own listed vehicles as part of the Company's crystallisation objectives;

- Further updates in respect of Power Capital Investments Ltd, the Company's wholly-owned new project incubator;

   -     Additional management and financial information for shareholders. 

African Exploration Projects

 
         Project                              Latest Position 
   Molopo Farms Complex     Work continues on technical analysis following 
          Project            the drill programme completed in early 2021. 
         Botswana            Significant nickel sulphides have been identified 
    (Nickel - Platinum       in the drill core with assays up to 1.7% 
  Group Elements (PGEs))     nickel and 0.55g/t platinum. Further selected 
  POW: Effective Economic    samples are to be assayed for additional 
      Interest 50.8%         nickel sulphide and PGE content. 
                             Discussions are in process with regard to 
                             corporate developments in respect of the 
                             Molopo Farms Complex interest together with 
                             next stage exploration including additional 
                             drilling. 
                             Key Potential Value Drivers: Confirmation 
                             of further nickel sulphide and platinum 
                             group elements (PGEs) from assay testing, 
                             outcome(s) from corporate discussions and 
                             launch of next stage exploration. 
                           ----------------------------------------------------- 
   South Ghanzi Project 
         Botswana             South Ghanzi Project is held within Kanye 
     (Copper - Silver)        Resources plc, a joint venture vehicle 50% 
         POW: 50%             held by Power Metal and 50% by partners 
                              Kavango Resources plc (LON:KAV) who are 
                              the operators of the project. 
 
                              Drill target refinement continues at the 
                              South Ghanzi Project, together with initial 
                              exploration at the recently acquired South 
                              Ghanzi Extension Licences and the Mamuno 
                              Licences. Together, the ground footprint 
                              in the Kalahari Copper Belt (KCB) totals 
                              4,257km(2) . 
 
                              Approval of the Environmental Management 
                              Plan (EMP) for South Ghanzi is being sought 
                              to enable drilling to be undertaken. 
 
                              Further consideration is being given by 
                              the joint venture partners with regard to 
                              the planned IPO of Kanye Resources plc and 
                              an update in this regard will be provided 
                              in due course. 
 
                              Key Potential Value Drivers: Approval of 
                              the EMP, drilling of South Ghanzi targets 
                              and initial exploration findings from the 
                              recently acquired KCB licences. 
                           ----------------------------------------------------- 
    Ditau Camp Project      Ditau Camp Project is also held within the 
         Botswana            Kanye Resources plc joint venture as outlined 
       (Rare Earths)         above. 
         POW: 50%            To date three specific targets have been 
                             identified for drilling, which is expected 
                             to commence in Q4 2021. 
                             Further exploration work is continuing on 
                             the ground including ground based geophysical 
                             surveys. 
                             Key Potential Value Drivers: Drilling of 
                             Ditau targets and results from ongoing exploration. 
                           ----------------------------------------------------- 
       Tati Project 
         Botswana             The company recently completed its Phase 
      (Gold - Nickel)         I and Phase II work programmes, which included 
         POW: 100%            high-resolution soil sampling (1,107 samples 
                              collected), mapping and prospecting (49 
                              rock samples collected), as well as ground-based 
                              geophysics including high-resolution magnetic 
                              and radiometric surveys. 
 
                              The results have highlighted five target 
                              areas across the two licences, which are 
                              defined by kilometre-scale geochemical anomalies 
                              that are coincident with various geological 
                              structures that were highlighted by the 
                              ground geophysical surveys. 
 
                              The company is now in the preparatory stage 
                              for an inaugural drilling campaign, which 
                              will include roughly 1000m of reverse circulation 
                              (RC) drilling across the various target 
                              areas. 
 
                              Drilling is expected to commence during 
                              the first week of October subject to final 
                              preparations. 
 
                              Key Potential Value Drivers: Results of 
                              ongoing exploration including drill results. 
                           ----------------------------------------------------- 
     Kisinka Project        Next stage exploration is drill testing 
          The DRC            of the 6.8km copper-cobalt geochemical anomaly 
     (Copper - Cobalt)       identified from previous exploration programmes. 
         POW: 70%            Preparations are continuing for drilling 
                             including target refinement and sourcing 
                             of appropriate contractors. 
                             Drilling is expected to commence in Q4 2021. 
                             Key Potential Value Drivers: Drill testing 
                             of copper-cobalt targets. 
                           ----------------------------------------------------- 
      Haneti Project 
         Tanzania             The next stage of exploration is deep diamond 
      (Polymetallic)          drill testing at Haneti targeting nickel 
         POW: 35%             sulphide - PGE mineralisation. 
 
                              Final preparations are underway for this 
                              drill programme which is targeted to commence 
                              in Q4 2021. 
 
                              Key Potential Value Drivers: Drill testing 
                              of nickel sulphide - PGE targets. 
                           ----------------------------------------------------- 
 

North American Exploration Projects

 
        Project                               Latest Position 
  Silver Peak Project     Assay results are currently pending from 
    British Columbia,      the recently completed summer drill programme. 
         Canada            Work continues on a potential IPO of the 
        (Silver)           Silver Peak project as well as the consideration 
        POW: 30%           of a number of alternative commercialisation 
                           opportunities. 
                           Key Potential Value Drivers: Pending assay 
                           results and confirmation of selected commercialisation 
                           approach. 
                         -------------------------------------------------------- 
     Alamo Project 
      Arizona, USA          The Notice Level Plan of Operations permit 
         (Gold)             which was required to commence the next 
     POW: Earn-in to        phase of exploration has been received. 
           75%              In line with recently introduced provisions 
                            an additional cultural and biological assessment 
                            is being undertaken which we expect to be 
                            completed by the end of October and thereafter 
                            work will commence. 
 
                            The work programme is expected to include 
                            trenching on one area of the Alamo Project, 
                            with associated sampling, assaying and mapping 
                            and thereafter potential drilling of a number 
                            of short percussion holes to test for gold 
                            and silver mineralisation. 
 
                            Key Potential Value Drivers: Launch of next 
                            stage exploration and associated results. 
                         -------------------------------------------------------- 
   Athabasca Uranium 
  Satskatchewan, Canada     241km(2) of ground has been staked surrounding 
        (Uranium)           the Athabasca Basin in Saskatchewan, Canada. 
        POW 100% 
                            In total 7 property packages have been assembled, 
                            all of which are prospective for uranium 
                            mineralisation. 
 
                            Work is being undertaken to assemble detailed 
                            project information and to determine next 
                            steps for the newly acquired properties. 
 
                            Key Potential Value Drivers: Publication 
                            of full property information, uranium prospectivity 
                            analysis and launch of Phase I work programme. 
                         -------------------------------------------------------- 
     Authier North 
     Quebec, Canada         A programme of detailed soil sampling, prospecting 
        (Lithium)           and rock sampling has recently completed. 
   POW earn in to 100% 
                            The programme was designed to test for the 
                            extensions of a lithium-bearing pegmatite 
                            dyke down dip to the north, and along strike 
                            to the east from the adjacent Authier Lithium 
                            Property. 
 
                            The Authier Lithium Property is owned by 
                            Sayona Mining Limited and is scheduled to 
                            go into production in 2023. The results 
                            from the recently completed programme will 
                            be released to the market once received, 
                            compiled and interpreted by Power Metal 
                            personnel. 
 
                            Key Potential Value Drivers: Results from 
                            the exploration programme now completed. 
                         -------------------------------------------------------- 
 

Disposal/Spin-Out Vehicle Packages (*)

* Please note other project packages within the Power Metal portfolio are also in earlier stages of spin-out preparations in addition to those listed below.

 
         Project                                     Latest Position 
    New Ballarat Gold       Power Metal has an interest in 49.9% of 
        Corporation          New Ballarat Gold Corporation plc ("NBGC") 
    Victoria, Australia      held in joint venture with 50.1% held by 
          (Gold)             Red Rock Resources plc (LON:RRR). 
        POW: 49.9%           Through its Australian operating subsidiary, 
                             Red Rock Australiasia Pty Ltd, NBGC has 
                             a strategic land footprint in the Victoria 
                             Goldfields, Australia. The footprint comprises 
                             1,458m(2) of ground under 9 licence applications 
                             and 7 granted licences covering 848km(2) 
                             . 
                             Extensive exploration is continuing, combining 
                             desk-based research with field exploration. 
                             Drill targets have been identified following 
                             additional discoveries of historic mine 
                             workings within the granted licence area. 
                             A diamond drill programme has been scheduled 
                             for the end of the year. 
                             The joint venture partners are working together 
                             to expedite a listing of NBGC on the London 
                             capital markets. The new board of NBGC has 
                             been selected in readiness for listing and 
                             NBGC has appointed all key advisors in this 
                             regard. 
                             Key Value Drivers: Material findings from 
                             ongoing exploration, further licence grants 
                             and the listing of NBGC on the London capital 
                             markets. 
                           ------------------------------------------------------------------- 
  Golden Metal Resources          During Q2/Q3 2021 Power Metal assembled 
        Nevada, USA                a strategic package of exploration and development 
    Gold - Base Metals             interests in Nevada USA under the corporate 
  POW - Various interests          vehicle Golden Metal Resources Ltd ("Golden 
    (see right column)             Metal"). Golden Metal's project portfolio 
         POW 100%                  includes: 
                                    *    Golconda Summit - an exploration property targeting 
                                         high grade near surface gold, where Power Metal has a 
                                         right to earn-in to a 100% interest. 
 
 
 
                                   Permit has now been received allowing a 
                                   trenching, sampling and mapping work programme 
                                   to be undertaken. Final preparations are 
                                   in hand and exploration is expected to commence 
                                   at Golconda Summit in October. 
 
                                    *    Garfield/Stonewall - two 100% owned exploration 
                                         properties targeting gold-silver mineralisation. 
 
 
 
                                   Initial exploration now launched includes 
                                   the processing of various Aster and Worldview-3 
                                   hyperspectal satellite imagery datasets 
                                   over the Garfield Property, which will allow 
                                   for the remote mapping of various iron and 
                                   hydrothermal alteration minerals. 
 
                                    *    Pilot Mountain - an option to acquire a 100% interest 
                                         in an advanced exploration and development property 
                                         with a substantial JORC compliant tungsten, copper, 
                                         silver and zinc resource. 
 
 
 
                                   Due diligence is fully underway to enable 
                                   option exercise to proceed by the date of 
                                   option expiry on 29/10/2021. 
                                   Golden Metal is seeking a listing on the 
                                   London capital markets and is currently 
                                   assembling its advisory team to complete 
                                   the listing documentation. 
                                   Key Value Drivers: Positive findings from 
                                   exploration work at Golconda Summit and 
                                   Garfield properties and the listing of Golden 
                                   Metal on the London capital markets. 
                           ------------------------------------------------------------------- 
    First Development       Power Metal is to acquire a 75% interest 
         Resources           in First Development Resources Pty Ltd (FDR 
     Western Australia       Australia), an Australian company holding 
      (Gold - Copper)        five exploration interests in the Paterson 
     POW: Conditional        Region of Western Australia. 
      Acquisition 75%        Initially the licences included one granted 
                             exploration licence and four licence applications. 
                             Power Metal has received confirmation that 
                             two additional exploration licence applications 
                             have now been granted (Wallal Main E45/5816 
                             and Wallal West 2 E45/5880), two of the 
                             three strategic Wallal Project licences, 
                             with the remaining licence (Wallal West 
                             1 E45/5853) expected to be granted imminently. 
                             The Wallal Project is the focus of ongoing 
                             exploration work including 2D seismic geophysics 
                             reprocessing and a passive seismic survey 
                             which is intended to help refine drill targeting 
                             within the Wallal Main Licence area. 
                             Drill targets comprise magnetic bullseye 
                             targets of similar geological nature to 
                             that drill tested by Greatland Gold plc 
                             leading to the discovery of the Havieron 
                             deposit in the Paterson Province. 
                             The acquisition which is now proceeding 
                             will trigger the acquisition of FDR Australia 
                             by First Development Resources Limited, 
                             which Power Metal plans to list on the London 
                             capital markets. 
                             Key Potential Value Drivers: Licence grants, 
                             formal acquisition of FDR Australia, listing 
                             in London and deep drill testing of magnetic 
                             bullseye targets. 
                           ------------------------------------------------------------------- 
    First Class Metals      Power Metal announced the disposal of its 
     Schreiber-Hemlo,        Schreiber-Hemlo interests to First Class 
      Ontario, Canada        Metals ("First Class") on 07/09/2021 for 
   (Gold - Base Metals)      consideration of GBP1mn. With the shares 
         POW c.38%           received on the disposal, and following 
                             a subscription by Power Metal of GBP28,764 
                             at GBP3/share in the pre-IPO raise, Power 
                             Metal currently has an interest of c.38% 
                             in First Class (after reflecting the c.GBP400,000 
                             pre-IPO raise undertaken by First Class). 
                             First Class is seeking a listing on the 
                             London capital markets and provided an update 
                             to shareholders on 27/09/2021 confirming 
                             considerable progress from both from exploration 
                             and corporate perspectives. 
                             Power Metal is working with First Class 
                             to support their listing plans and looks 
                             forward to reporting further progress in 
                             this regard. On listing Power Metal will 
                             be a significant shareholder in First Class. 
                             Key Potential Value Drivers: Exploration 
                             updates from the Schreiber-Hemlo interests 
                             and listing of First Class on the London 
                             capital markets. 
                           ------------------------------------------------------------------- 
 

New Opportunities

 
          Project                                     Latest Position 
 Power Capital Investments        Power Capital Investments (Power Capital) 
          Limited                  is currently in the early stages of three 
      Global Resource              potential new projects namely: 
     Project Incubator              *    Gold exploration in Europe where Power Capital has a 
     (Multi-Commodity)                   signed agreement with a third party. To date assay 
         POW: 100%                       testing of samples has been undertaken demonstrating 
                                         high-grade gold mineralisation in hand samples. 
                                         Currently Power Capital is funding the third party to 
                                         lodge licence applications covering the area of 
                                         interest. Thereafter the plan is to launch additional 
                                         exploration programmes. Power Capital may earn-in to 
                                         a 50% interest by expending EUR100,000 on exploration 
                                         and corporate costs. 
 
 
 
                                    *    Consideration of an African rare earths initiative 
                                         with a specialist geological team employing new 
                                         technology to identify rare earth deposits in Africa. 
 
 
                                   Limited information will be provided in 
                                   respect of the above Power Capital projects 
                                   to preserve commercial sensitivity, notably 
                                   where work is needed to secure exploration 
                                   licences or to protect commercial partners. 
                                   At present none of the Power Capital projects 
                                   above are considered material in the context 
                                   of the Power Metal business overall. Should 
                                   they become so, further disclosures may 
                                   be necessary. 
                                   NOTE: A maximum investment level of GBP100,000 
                                   per opportunity has been established and 
                                   a minimum 50% Power Capital holding interest 
                                   in any opportunity following Power Capital's 
                                   investment. 
                                   Key Potential Value Drivers: Advancement 
                                   of any Power Capital investment into full 
                                   Power Metal project status or spin-out IPO 
                                   opportunity. 
                            ------------------------------------------------------------------ 
 

Management and Financial

 
       Project                           Latest Position 
        Board           Further to the announcement of 21 September 
                         2021, Andrew Bell, Chairman of Power Metal 
                         stepped down from the board yesterday to 
                         focus on the large spin-out IPO of NBGC 
                         (see above). 
                         Current Non-executive director Scott Richardson 
                         Brown is to become Interim Chairman pending 
                         the appointment of a new Chairman in due 
                         course. 
                       -------------------------------------------------- 
  Senior Management     The Company operates a hub and spoke operational 
                         management style coordinating and controlling 
                         global exploration operations from its UK 
                         Head Office. 
                         In 2021 with the growth of our business 
                         portfolio, and the success of exploration 
                         and commercial ventures, we have built the 
                         Head Office team with exploration management, 
                         commercial management and financial and 
                         administrative support. 
                         We are also seeking to optimise resources, 
                         and our Head Office team will be deployed 
                         to support spin-out vehicles, managerially 
                         and administratively, helping to reduce 
                         the operational costs to Power Metal of 
                         new team members. 
                       -------------------------------------------------- 
  Financial Position    Power Metal has a growing balance sheet 
                         which, as with many other exploration companies, 
                         has a core of capitalised exploration costs 
                         for ongoing exploration projects. 
                         Power Metal can monetise its operational 
                         interests as demonstrated by the disposal 
                         of the Schreiber-Hemlo business interests 
                         (see above). 
                         And importantly, Power Metal is planning 
                         to spin-out other business interests into 
                         listed vehicles, and any new listings will 
                         add materially to the Company's balance 
                         sheet. 
                         Excluding all of the above the Company also 
                         holds working capital, comprising cash and 
                         currently listed (tradable) investments, 
                         which funds day to day operations. As at 
                         24/09/2021 this amounted to working capital 
                         of GBP2.51million. 
                       -------------------------------------------------- 
 Audit and Compliance   As the financial year comes to a close Power 
                         Metal is working with One Advisory, its 
                         financial and compliance service partner, 
                         to prepare for the annual audit, with financial 
                         results for the year ended 30 September 
                         2021 expected to be published in February 
                         2022. 
                         As a responsible exploration company Power 
                         Metal is further bolstering its Environmental, 
                         Social and Governance initiatives and will 
                         be publishing further information in the 
                         coming months covering the various measures 
                         implemented. 
                         In 2020 the Company undertook a Finance, 
                         Administration and Compliance Protocols 
                         and Procedures Review to further improve 
                         its underlying Governance and is now further 
                         bolstering this with detailed business process 
                         mapping across the Company. These measures 
                         are considered necessary as the Company 
                         expands in size, scale and breadth of corporate 
                         and exploration activities. 
                       -------------------------------------------------- 
 

COMPETENT PERSON STATEMENT

The technical information contained in this disclosure has been read and approved by Mr Nick O'Reilly (MSc, DIC, MIMMM, MAusIMM, FGS), who is a qualified geologist and acts as the Competent Person under the AIM Rules - Note for Mining and Oil & Gas Companies. Mr O'Reilly is a Principal consultant working for Mining Analyst Consulting Ltd which has been retained by Power Metal Resources PLC to provide technical support.

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

For further information please visit https://www.powermetalresources.com/ or contact:

 
Power Metal Resources plc 
Paul Johnson (Chief Executive Officer)                +44 (0) 7766 465 617 
 
SP Angel Corporate Finance (Nomad and Joint Broker) 
Ewan Leggat/Charlie Bouverat                          +44 (0) 20 3470 0470 
 
SI Capital Limited (Joint Broker) 
Nick Emerson                                          +44 (0) 1483 413 500 
 
First Equity Limited (Joint Broker) 
David Cockbill/Jason Robertson                        +44 (0) 20 7330 1883 
 
 
 
 

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration company which finances and manages global resource projects and is seeking large scale metal discoveries.

The Company has a principal focus on opportunities offering district scale potential across a global portfolio including precious, base and strategic metal exploration in North America, Africa and Australia.

Project interests range from early-stage greenfield exploration to later-stage prospects currently subject to drill programmes.

Power Metal will develop projects internally or through strategic joint ventures until a project becomes ready for disposal through outright sale or separate listing on a recognised stock exchange thereby crystallising the value generated from our internal exploration and development work.

Value generated through disposals will be deployed internally to drive the Company's growth or may be returned to shareholders through share buy backs, dividends or in-specie distributions of ass ets.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

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